The World Bank investment arm, the International Finance Corporation, hopes to entice pension funds to inject capital into fighting climate change in the next few months, the global head of its climate business group said.
Pension and sovereign wealth funds control an estimated $28 trillion but less than one percent currently goes into climate-related activity.
The United Nations wants to steer at least $100 billion a year of investment into combating climate change by 2020.
“In an ideal world, 80 percent of the money should come from the private sector,” Mohsen Khalil told Reuters in an interview on the sidelines of a carbon conference on Wednesday in Barcelona, Spain.
Pension funds could provide a large source of private capital but have been cautious about investing in the sector.
“The missing link is pension funds and they have to be tapped,” Khalil said.